In an unpublished opinion released August 24th, the Ninth Circuit rejected a long waged effort to upend the City of Bend’s water planning by forcing it to abandon its vested surface water rights in favor of an all-groundwater supply. As is often the case, plaintiffs chose a somewhat oblique attack on the City’s water planning, relying on NEPA and forest planning laws to force a change of direction.

Central Oregon LandWatch v. Connaughton was a challenge to a Special Use Permit issued by the U. S. Forest Service to the City to construct a new pipeline and to upgrade water diversion facilities on Tumalo Creek, within the Deschutes National Forest. The existing pipeline also was previously constructed within the national forest under a SUP, but needs replacement. The project drew controversy.

Plaintiffs contended that cessation of water withdrawals by the City is necessary to preserve Tumalo Falls, whereas the City argued that the project would enhance Tumalo Creek. To maintain pressure, the old pipeline needed to be kept full, resulting in constant diversions and discharge of surplus water downstream. The new pipeline allows the City to withdraw water on demand, which will keep more water in the stream. In addition, the City is working closely with the Tumalo Irrigation District to further protect the creek.

An amici group comprised of municipal and agricultural water users, intervened on behalf of the Forest Service and the City. (Disclosure: Our firm represents the amici, and serves as water counsel to the City, though we did not represent the City in this case). The Oregon Water Resources Department separately intervened as an amicus.

The central concern for amici was the integrity of Oregon’s appropriative water rights law, which follows the first in time, first in right principle of other Western states. Plaintiffs sought to upend that principle by elevating federal minimum flows in the forest planning context over state water law. Oregon law allows the Oregon Department of Fish and Wildlife to apply for instream water rights, which would have priority from the date of application and would be treated like any other water right. The purpose of the instream right is to prevent future appropriations, and so the “minimum” flows in the water right usually comprise or exceed the entire flow of the stream.

Plaintiffs argued that the Forest Service should have imposed minimum flows for the creek in the SUP, which they contended should be derived from the instream water established for Tumalo Creek. The problem is that the instream water right is junior in priority to the City’s water rights. Imposing the instream water right flows as a condition of the SUP would effectively turn appropriative water rights law on its head. The instream right—with its aspirational flow regime—would then take precedent over the City’s right.

The court below rejected that outcome, as did the Ninth Circuit but on the basis that establishment of minimum flows are not required by rule or case law. Further, doing so would not benefit Tumalo Creek because the City’s project would “positively impact stream flows” in one reach of the creek and “have no or minimal impact” in two other reaches, one of which is subject to Tumalo Irrigation District diversions that are not subject to the SUP.

The court also found that the Forest Service did not violate NEPA by limiting the alternatives analysis in the Environmental Assessment to just two: (1) implementation of the project and (2) a “no action” alternative based on the existing SUP. In other words, the court was not troubled by the Forest Service assuming that continuing exercise of the City’s surface water rights represents the status quo. The court rejected plaintiffs’ argument that the Forest Service needed to additionally evaluate an alternative scenario where the City reduces or ceases withdrawals from Tumalo Creek. The court found that the discussion in the Environmental Assessment was adequate, and relied on language in the EA that fully supports the City’s water planning:

The Forest Service determined that the surface water formed a “critical component of the City’s dual-source [water] supply.” . . . The EA explained that groundwater-only options would “compromise the City’s ability to provide a safe and reliable water supply,” reduce water flows in other parts of the Deschutes River, be costly, and be less reliable than a dual-source system. The EA also flagged possible environmental concerns posed by the groundwater-only option, including reduced surface stream flows (which are fed by groundwater) and increased energy consumption caused by pumping groundwater. This discussion was sufficient.

A dual source water system is the dream of every municipal water planner. That redundancy is insurance against natural or human-caused catastrophes that could disable one source. And all water users need to be able to rely on the priority of water rights under the law. That the Forest Service and the Ninth Circuit declined to upset the City’s long-term water planning is a victory for municipal water planners everywhere.

H.R. 23 is an important and most unfortunate environmental bill currently working its way through the U.S. Congress. Sponsored by California Republican Congressman David Valadeo—with a strong assist from House Republican Majority Leader Kevin McCarthy—H.R. 23 passed the House of Representatives last month on what was largely a party-line vote, 230-190. It has now moved to the U.S. Senate.

This California-specific legislation would “reform” federal and California state water and environmental laws in order to provide more water from federal and state water projects in California to state agricultural interests in the state’s Central Valley. H.R. 23 would do so at the expense of environmental values. (That’s not mere interpretation or speculation on the part of this observer—it’s the express intent of the bill.)

Why, exactly, is H.R. 23--which has largely evaded public and media attention to date--such a flawed legislative proposal? Let me count the ways:

First, it would reverse an over century-long tradition of federal deference to state water law regarding the construction and operation of federal water projects. Congress made that commitment in the Reclamation Act of 1902, which transformed the settlement and economy of the American West. Congress has reiterated this commitment to cooperative federalism in numerous subsequent federal statutes. But H.R. 23 reneges on that promise, expressly preventing California state water regulators from imposing any restrictions on the federal Central Valley Project that would protect environmental values.

Doubling down on its preemptive effect, H.R. 23 expressly exempts the CVP (and those who obtain water from it) from application of California’s public trust doctrine, which—as is true of many other states—operates as a longstanding, cornerstone principle of California natural resources law.

Additionally, H.R. 23 brazenly exempts operation of the CVP and other California water projects from the federal Endangered Species Act “or any other law” pertaining to those operations.

H.R. 23 thus is terrible news for California’s environment. But why should environmental attorneys from other states be concerned about the bill?

The answer is again multifaceted. H.R. 23 represents the first serious Congressional effort of 2017 to weaken application of the Endangered Species Act. The broad ESA exemption contained in H.R. 23 could easily be replicated in future federal legislation affecting federal, state or local projects in other parts of the country.

Similarly, if the longstanding tradition of federal deference to application of state water law is breached by passage of H.R. 23, rest assured that similar attempts will be made concerning similar projects in other states as well.

H.R. 23 is opposed by both of California’s U.S. Senators, along with California Governor Jerry Brown. Even more notably, California’s largest water district—the Metropolitan Water District of Southern California—has signaled its opposition to the bill, declaring that it “goes too far” in elevating agricultural water interests over California’s environment.

H.R. 23: an awful bill for California, and a terrible precedent for the nation as a whole.

Last month, Mark Walker posted about Executive Order 13771. Mark’s post was generally favorable, noting that a number of other countries have implemented some version of what is known as a “regulatory budget.” This post provides something of a counterpoint to Mark’s.

Put simply, I think that the Order is indefensible. It’s not about regulatory reform. It’s a transparent attempt to halt environmental regulation in its tracks, without regard to the benefit those regulations provide.

This week, on behalf of our client, the Union of Concerned Scientists, Foley Hoag filed an amicus brief in support of the plaintiffs in the case challenging the EO. One paragraph from the brief pretty much summarizes the argument:

It is important to note, as Executive Order 13771 acknowledges, that agencies are already required, where not prohibited by law, to ensure that the benefits of regulations exceed their costs. Thus, the only impact of the Executive Order is to prohibit agencies from promulgating regulations whose benefits exceed their costs, unless they eliminate two other regulations whose benefits also exceed their costs. This is the definition of unreasoned decisionmaking. It is also a thumb in the eye of Congress, which enacted public health and environmental statutes in order to benefit the public.

It is a bitter irony that the government is defending the EO in part on the basis that it is just another in a long line of regulatory reform EOs, even though the EO is in fact a repudiation of those prior orders, not an extension of them. This order is not about cost-benefit analysis; it is about cost-only analysis. By definition this approach ignores the public benefits that the underlying statutes are intended to provide. Thus, the “savings clause” cannot save the EO, because there is nothing left to save.

Here’s a thought exercise: I’ll give you a budget of 25 words (including conjunctions, articles, and all the other little ones). You use up a word by either deleting, adding, or replacing one in an existing federal environmental or natural resources statute. How much could you transform the field of practice with just those 25 word edits? The answer is, quite a lot.

When we think of statutory reform, we usually think big, right on up to “repeal and replace.” But after more than 25 years of very little legislative action on federal environmental and natural resources statutes—the National Wildlife Refuge Improvement Act, Sustainable Fishing Act, and the recent Toxic Substances Control Act reforms are a few exceptions since the 1990 Clean Air Act amendments—much rides on the accumulations of judicial and agency interpretations of the meaning of a word here and a phrase there. As we enter a period of potential legislative volatility in this field, therefore, the rifle shot may be just as much in play as the nuclear bomb.

Like any statutory reform, rifle shots can make regulatory statutes either more or less regulatory. For example, one could add “including carbon dioxide” or “excluding carbon dioxide” in just the right place in the Clean Air Act and with those three words put an end to a lot of debate and litigation. Given the current political climate, however, it’s reasonable to assume any rifle shot would be aimed at reducing regulatory impacts. But even with just 25 words in the clip, one could transform the impact of several regulatory programs before running out.

For example, delete the words “harm” and “harass” from the statutory definition of “take” in the Endangered Species Act (ESA) (16 U.S.C. 1532(19)) [LINK 1] and you have a very different regulatory program. Much if not most of the land use regulation impact under the ESA stems from the inclusion of those two words; without them, the ESA’s prohibition of unpermitted take would restrict actions like hunting, killing, shooting, and wounding, but could not reach indirect “harming” from habitat modification. Of course, the interagency consultation program under Section 7 (16 U.S.C. 1536(a)(2)) [LINK 2] would still be in place, prohibiting federal agencies from taking actions that “jeopardize” the continued existence of species. But just add “substantially” before “jeopardize” and the practical effect of that prohibition is greatly reduced.

I’ve managed to transform the ESA, vastly reducing its regulatory impact, with just three word tweaks. Twenty-two to go. Here are some more examples. I’ll let readers evaluate the impacts.

·Speaking of evaluating impacts, the environmental impact review process of the National Environmental Policy Act (NEPA) can really slow things down (42 U.S.C. 4332(B)). [LINK 3] To “streamline” the process, add the word “direct” before “environmental impact” in subpart (C)(1), which would eliminate the current practice of requiring analysis of indirect and cumulative impacts, and delete subpart (C)(iii), which requires agencies to evaluate “alternatives to the proposed action,” to remove a factor that bogs down much NEPA litigation. (Six more words down, sixteen to go.)

·Heard all the commotion about which “waters” are subject to the Clean Water Act? Clear that up by changing the statutory definition of “navigable waters” (33 U.S.C. 1362(7)) [LINK 4] to read “waters of the United States subject to navigation.” That would be pretty extreme—it would remove most wetlands from jurisdiction—so one could control how far jurisdiction extends over wetlands by adding and their adjacent wetlands.” This would draw the line much closer to navigable water bodies than current interpretations reflected in Supreme Court opinions and agency regulations—Rapanos and the Water of the United States Rule become history. (Seven more words down, nine to go.)

·And if you also want to put to rest the question whether the Clean Water Act applies to groundwater, edit the front end of the definition to read “surface waters.” (Another word down, eight to go.)

·The Circuits are split over whether the Migratory Bird Treaty Act’s list of prohibited activities (16 U.S.C. 703(a)), [LINK 5] which includes to “take” or “kill,” sweeps within the statute’s reach any “incidental” taking or killing—injury or mortality that is not the direct purpose of the activity, such as strikes by wind turbines. Easy to solve! Add the word “purposeful” before the list of prohibited activities. (Another word down, seven to go.)

·And, while we’re at it, let’s go ahead and add “excluding carbon dioxide” to the Clean Air Act definition of “air pollutant” (42 U.S.C. 7602(g)). [LINK 6] Adios, Clean Power Plan. (Three more words down, leaving just four to go.)

I’ll leave it to readers to think about how to use the last four words. The point here is that the system of environmental and natural resources law has become quite fragile. With Congress out of the picture for so long, courts and agencies have built up an interpretation infrastructure under which a single word or phrase often carries a tremendous burden of substantive and procedural program implementation. As a consequence, a mere tweak here and there can have dramatic effects on the program.

Granted, anyone who closely follows the statutes tweaked above will quickly appreciate the impact of any of the tweaks, and I’ve chosen some powerful examples unlikely to slip by any such experts. But subtler tweaks buried deep in a larger bill could more easily fly below the radar.

It remains to be seen whether Congress takes this rifle shot approach or goes bigger. Rifle shots don’t eliminate or “gut” entire programs, which may be the current congressional appetite, but the above examples show the potency of this approach. I for one will be keeping my eyes out for rifle shots in bills every bit as much as I will be following the big bomb reform efforts. Do not underestimate the power of the tweak!

President Trump wasted no time making good on his promise to reverse President Obama’s efforts to reduce greenhouse gas emissions and move U.S. energy policy towards cleaner energy sources. On January 24 Trump signed two executive memoranda, one inviting TransCanada to resubmit its application to build the 800,000 barrel a day Keystone XL pipeline from the Canadian oil sands to the Gulf Coast; the other directing the Army Corps of Engineers to expedite the review and approval of the Dakota Access Pipeline (DAPL) to carry approximately 500,000 barrels per day of crude oil from the Bakken shale in North Dakota to oil markets in the United States. But a close reading raises some sticky legal and economic issues that will have to be resolved before the oil starts flowing. [LINKS to Keystone and DAPL Memos]

In announcing the Keystone Memo, Trump said that approval was contingent on TransCanada’s willingness to “renegotiate some of the terms” – including perhaps a commitment to use US steel and a share in any profits. The problem is that tar sands oil is not only the dirtiest fuel on the planet, it’s also the most expensive to extract. To be profitable oil prices need to be above $80 per barrel; today they sit around $52, and it is unlikely they will rise much higher in the foreseeable future given the competition from shale oil and the fracking boom that is flooding the market in the US. The break-even point for Bakken shale oil is $29 per barrel. Seventeen major oil sands projects were canceled after oil prices crashed in 2014, as companies took major losses. Major investors in the oil sands have begun to leave, including Norway-based Statoil, which pulled out of the oil sands in December 2016. So cutting a deal to the President’s liking may be harder than it looks.

Assuming the deal goes down, the Keystone Memo issues several directives to clear the way for the project. It directs the State Department to make a final decision within 60 days of the date TransCanada re-submits its application, and it further specifies that “to the maximum extent permitted by law” the final supplemental EIS issued in 2014 shall satisfy the requirements of NEPA as well as the consultation requirements of the Endangered Species Act, and “any other provision of law that requires executive department consultation or review.” The Keystone Memo also directs the Corps of Engineers to use Nationwide Permit 12 to summarily authorize the stream crossings needed to complete the project. These fast track measures are sure to be tested in court by the opponents who are not about to let their hard won victory be snatched away without a furious fight—in the courts as well as in the streets. While courts have ruled that the presidential permit itself is not reviewable, there is presumably no bar to challenging the decisions of the Corps and the Department of Interior that are necessary to complete the project.

The DAPL Memo directs the Secretary of the Army and the Chief of the Corps of Engineers to “review and approve in an expedited manner, to the extent permitted by law and as warranted, and with such conditions as are necessary or appropriate, requests for approvals to construct and operate the DAPL, including easements or rights-of-way to cross Federal areas under section 28 of the Mineral Leasing Act.” The Memo also instructs the Secretary to consider whether to rescind the memorandum issued by the Obama administration requiring preparation of an EIS on DAPL’s request for an easement to cross Lake Oahe, and to deem the previously-issued Environmental Assessment sufficient to satisfy NEPA.

The Standing Rock protest over DAPL has become an historic confrontation that has united an Indigenous land-and-water movement and climate activism to confront a fossil-fuel corporation protected by a militarized police force. At one point in December thousands of veterans arrived to provide a safe space for the protesters who call themselves “water protectors.” Litigation filed by the Standing Rock Tribe and other tribes challenging the Corps’ issuance of permits under the Clean Water Act and Rivers and Harbors Act is pending in federal district court in the District of Columbia. Judge Boasberg denied a preliminary injunction but has yet to rule on the merits of the case. At the moment, the court is considering DAPL’s motion for summary judgment to declare that the project already has all of the approvals it needs and the Corps should not be able to reverse its earlier decision that an EIS was not required. Though the Justice Department has vigorously opposed this move, it will be interesting to see whether the Trump administration adopts a different posture. In any event, the Tribe has raised serious questions about whether the Corps properly evaluated threats to its water supply intake and alternative routes that would lessen the risk. One of the allegations invokes environmental justice concerns arguing that the project was re-routed away from Bismarck in response to concerns about threats to its water supply. The Tribe has also raised novel questions about whether granting the easement would violate treaty rights under the 1851 Treaty of Fort Laramie.

At the hearing on DAPL’s motion for summary judgment, Judge Boasberg acknowledged the uncertainty about what the new administration might do but observed that “It’s not my business to guess.” For now the rest of us will have to guess at what the final outcome of this epic confrontation that has galvanized indigenous peoples from all over the world will be.

What will a Trump Presidency mean for environmental law? I’m not sure my crystal ball is better than anyone else’s, but here are a few quick thoughts:

It’s still going to be difficult to amend the key statutes, unless the GOP goes nuclear with the filibuster rules. I don’t see Clean Air Act amendments happening. Significant amendments might be possible to the Endangered Species Act and Superfund.

Changing regulations is more difficult than one might think. As has already been noted, the Bush administration did not fare too well with judicial review of its efforts to roll back some Clinton environmental initiatives. For example, I still think that the new ozone standard should survive and I think that courts would take a dim view of EPA efforts to raise it. The Clean Power Plan is another matter. All Trump needs there may be a new Supreme Court Justice.

The easiest target is executive orders. The social cost of carbon? Toast. Guidance on incorporating climate change into NEPA? Toast.

Trying to keep things light, I’ll close with a summary in haiku, which often takes nature as its subject.

The American College of Environmental Lawyers annually presents the Herrmann Environmental Writing Award to the individual who has written and submitted what we judge to be the best article from a student-edited law journal or equivalent publication published by an accredited U.S. law school, including an article, note, case comment or essay. The winning piece is selected for its ability to promote understanding of legal issues in the broad field of environmental law, including natural resources law and/or environmental or resources aspects of energy law.

The award is named in honor of our College colleague Stephen E. Herrmann, who is a distinguished, nationally recognized environmental lawyer and who has – for some forty years – been a leader in the area of environmental law as a practitioner, teacher and writer.

This year, there were twenty-nine separate entries for the Herrmann Award. A panel of ACOEL members reviewed and evaluated each entry based on its originality, quality of research, presentation and writing, and significance of contribution to the field of environmental law. After completing that review, the reviewing panel announced at the 2016 ACOEL annual meeting in New Orleans that this year’s winner of the Herrmann Environmental Writing Award is Ms. Irene Weintraub Shulman. Ms. Shulman’s article – published in the Cardozo Law Review [link] – is “NEPA and Uncertainty in Low-Risk, High-Impact Scenarios: Nuclear Energy as a Case Study.” In addition to winning the award, Ms. Shulman received a stipend of $3,500, and the submitting law journal (Cardozo) received $500. Ms. Shulman was also invited to attend a portion of the College’s meeting in New Orleans.

ACOEL remains gratified at the level of interest and academic excellence represented by all the submissions we received. And we again congratulate Ms. Weintraub Shulman and the Cardozo Law Review on their fine submission.

Back in the early days of the College, then-incoming President Brad Martin had asked interested Members to work with Lexis Nexis in developing some treatises on a range of topics. Indeed, years later you can go to this link to see how you too can join the very few who purchase some of these treatises, see a photo of Brad, and the list of ACOEL authors. New Council of Environmental Quality guidance on treatment of climate change in federal environmental impact analysis suggests these treatises may have some impact.

I agreed to and with the aid of one of Brad’s former associates, in 2010 authored a treatise entitled “Treatment of Greenhouse Gases Under the National Environmental Policy Act” . We addressed the then-recently released (February 2010) White House Council on Environmental Quality’s Draft Guidance on consideration of climate change and greenhouse gases in NEPA environmental reviews. In the conclusion I said:

With the prospects for comprehensive, economy-wide regulations on greenhouse gas emissions uncertain, climate change will continue to be addressed under existing environmental laws, including NEPA and its state-level counterparts. It has become increasingly clear that project proponents and lead agencies will be hard-pressed to avoid evaluating greenhouse gas emissions and other climate-related impacts attributable to public and private development projects. But disparate treatment across federal and state jurisdictions has left agencies and developers struggling with when and how to evaluate such impacts in their environmental review documents. Despite a growing body of regulations, case law, and guidance, substantial uncertainty remains regarding the scope, type, and depth of analyses required of climate change effects under NEPA and state analogues.

Little did I know or even suspect that the “disparate treatment” would continue unabated for another 5-plus years. The Draft Guidance was intended to be finalized in 2011, but the final version would not be released until the waning days of the Obama Administration On August 2, 2016, the CEQ has now issued its 34-page Final Guidance, which expressly requires all Federal agencies to include climate change in their analysis of environmental impacts.

In sum, the Final Guidance (at 4-6):

“[r]ecommends that agencies quantify a proposed agency action’s projected direct and indirect GHG emissions, taking into account available data and GHG quantification tools that are suitable for the proposed agency action; Recommends that agencies use projected GHG emissions (to include, where applicable, carbon sequestration implications associated with the proposed agency action) as a proxy for assessing potential climate change effects when preparing a NEPA analysis for a proposed agency action; Recommends that where agencies do not quantify a proposed agency action’s projected GHG emissions because tools, methodologies, or data inputs are not reasonably available to support calculations for a quantitative analysis, agencies include a qualitative analysis in the NEPA document and explain the basis for determining that quantification is not reasonably available; Discusses methods to appropriately analyze reasonably foreseeable direct, indirect, and cumulative GHG emissions and climate effects; Guides the consideration of reasonable alternatives and recommends agencies consider the short- and long-term effects and benefits in the alternatives and mitigation analysis; Advises agencies to use available information when assessing the potential future state of the affected environment in a NEPA analysis, instead of undertaking new research that is, and provides examples of existing sources of scientific information; Counsels agencies to use the information developed during the NEPA review to consider alternatives that would make the actions and affected communities more resilient to the effects of a changing climate; …and Counsels agencies that the “rule of reason” inherent in NEPA and the CEQ Regulations allows agencies to determine, based on their expertise and experience, how to consider an environmental effect and prepare an analysis based on the available information.”

How many of our LexisNexis recommendations were reflected in the Final Guidance I cannot yet say. But one moral of this tale is that College members may be able to direct a spotlight on needed changes in environmental regulating, even when those wheels of justice grind exceeding slow.

The U.S. Court of Appeals for the District of Columbia Circuit on July 5 issued a ruling that the federal government violated the Endangered Species Act and the Administrative Procedure Act in approving the long-running, oft-litigated Cape Wind offshore wind project proposed to be built off the Massachusetts coast. Senior Judge Randolph, writing for an unanimous panel, confirmed the District Court’s rejections of a number of the claims advanced by Plaintiffs (who included the Public Employees for Environmental Responsibility, the Town of Barnstable, and the Alliance to Protect Nantucket Sound), but reversed the District Court on two key points.

The proposed Cape Wind project, which has been the subject of voluminous news coverage and many court cases for well over a decade, sought to construct 130 3.6 MW turbines in shallow waters near Nantucket. Challenges have included scenic impacts; Native American concerns that the project would will block their sunrise views across the sound, disturb ancestral burial grounds, and perhaps disturb cultural relics; and issuance of submerged land leases required by the project. Financial hurdles seemed to put the project into a death spiral two years ago, but quietly the project developers have continued legal fights to defend the permits and approvals previously issued. They have largely been successful—until this month.

Early on, biologists with the U.S. Fish and Wildlife Service (“FWS”) had recommended that the wind turbines be shut off during limited periods of highest risk to two birds listed under the Endangered Species Act-- the piping plover and roseate tern. However, the FWS ultimately rejected that conservation measure on the grounds that it would impair the financial feasibility of the project. The Court of Appeals held that the FWS’s action was arbitrary and capricious. The Court further held that the project cannot proceed without compliance with the Migratory Bird Treaty Act and without further analysis of environmental impacts pursuant to the National Environmental Policy Act.

In conclusion, the Court stated: “We reverse the district court’s judgment that the Bureau’s environmental impact statement complied with NEPA and that the Service’s incidental take statement complied with the Endangered Species Act, and we vacate both statements.” A copy of the ruling is here.

In companion cases, on June 28 the DC Circuit Court of Appeals held that the Federal Energy Regulatory Commission, in its environmental impacts analysis of two Gulf Coast LNG terminals, need not assess the potential for increased natural gas extraction and use, or market effects. The first case deals with the Freeportproject in Texas, and the second the Sabine Passproject in Louisiana; the court considered these cases in parallel with each other, and the Sabine Pass case follows the reasoning in the Freeport case.

The Sierra Club and other national NGOs have attacked LNG facilities (1) for their potential to cause an increase in fracking to extract natural gas and the attendant emission of greenhouse gases, and (2) for increasing the use of U.S.- produced natural gas in world markets, which they assert will drive up the price of natural gas domestically, thus making coal more competitive and its use more prevalent in the U.S. On this basis the Freeport and Sabine Pass plaintiffs argued that FERC’s failure to consider these potential effects violates the National Environmental Policy Act. The court disagreed, finding that these effects are too attenuated for FERC to have to evaluate.

Central to the cases is the fact that the Natural Gas Act confers exclusive authority over the export of natural gason the Department of Energy, whereas FERC is only responsible for the siting of LNG facilities. The court reasoned that FERC’s approval of LNG facilities are not the proximate cause of gas exports, which only DOE can approve. Therefore, FERC need not consider environmental impacts related to market forces that could increase domestic production of gas and the use of gas outside of the United States.

These same projects face challenges brought by the same NGOs against DOE in which the issue is whether DOE complied with NEPA in authorizing exports of LNG. The Freeport and Sabine Pass courts “express no opinion” on the merits of the DOE cases. Still, it seems that the relationship between export approvals and operation of global gas markets is at least as attenuated as FERC’s authorization to construct facilities. My sense is that DOE will likely prevail there as well.

August 25, 2016 is the 100th anniversary of the National Park Service. The many planned celebrations and observances provide an opportunity for everyone to become reacquainted with these great outdoor spaces and reflect on the world around us. As your summer plans take shape, be sure to visit FindYourPark.com and try to visit at least one national park. I invite you to share photos of your travels in the comments section of this post, and perhaps ACOEL can find a place for the collection of images of its members enjoying these national treasures.

As I reflect on the Park Service’s anniversary, I observe that it presents a chance for me – and for all environmental lawyers – to take stock of where we have been as a profession. Why – and how – we do what we do? What challenges will the next 100 years hold?

I issue this charge, in part, to carry on the conservation legacy of Henry L. Diamond. Henry was a founder of my firm, Beveridge & Diamond, and a great environmental lawyer and mentor to many (including myself). Sadly, we lost Henry earlier this year.

Henry and many others like him paved the way for our generation to be stewards of the planet and the environmental laws that govern our interactions with it. We have made progress, but new challenges have emerged. Easy answers, if they ever existed, are fewer and farther between. So what, then, does the future hold for the next generation of environmental lawyers?

Future generations of lawyers would do well to focus on the funding mechanisms that are critical but often overlooked components to achieving our most important environmental and sustainability goals. As an example, we can look to the past. Early in his career, Henry Diamond assisted the Chairman of the Outdoor Recreation Resources Review Commission, Laurance Rockefeller, in editing the Commission’s seminal report, Outdoor Recreation for America, that was delivered to President John F. Kennedy in 1962. Among the Commission’s more significant recommendations was the idea to use revenues from oil and gas leasing to pay for the acquisition and conservation of public lands. Congress took action on this recommendation, creating the Land & Water Conservation Fund in 1965 as the primary funding vehicle for acquiring land for parks and national wildlife refuges. While the fund has been by all accounts a success in achieving its goals, much work remains to be done and the fund is regularly the target of budgetary battles and attempts to reallocate its resources to other priorities. Today, the four federal land management agencies estimate the accumulated backlog of deferred federal acquisition needs is around $30 billion.

I expect climate change will dominate the agenda for the young lawyers of our current era. They will need to tackle challenges not only relating to controlling emissions of greenhouse gases, but also adaptation resulting from climate change. Sea level rise, altered agricultural growing seasons, drought and water management, and other issues will increase in prominence for this next generation.

We can expect our infrastructure needs to continue to evolve – not only replacing aging roads, bridges, tunnels, railroads, ports, and airports, but also the move to urban centers and the redevelopment of former industrial properties. Autonomous vehicles and drones also pose novel environmental and land use issues. These trends will require us to apply “old” environmental tools in new ways, and certainly to innovate. As my colleague Fred Wagner recently observed on his EnviroStructure blog, laws often lag developments, with benefits and detractions. Hopefully the environmental lawyers of the future will not see – or be seen – as a discrete area of practice so much as an integrated resource for planners and other professions. Only in this way can the environmental bar forge new solutions to emerging challenges.

The global production and movement of products creates issues throughout the supply chain, some of which are just coming to the fore. From raw material sourcing through product end-of-life considerations, environmental, natural resource, human rights, and cultural issues necessitate an environmental bar that can nimbly balance progress with protection. As sustainability continues its evolution from an abstract ideal to something that is ever more firmly imbedded in every aspect of business, products, services, construction, policymaking and more, environmental lawyers need to stay with their counterparts in other sectors that are setting new standards and definitions. This area in particular is one in which non-governmental organizations and industry leaders often “set the market,” with major consequences for individuals, businesses, and the planet.

Finally, as technology moves ever faster, so do the tools with which to observe our environment, to share information about potential environmental risks, and to mobilize in response. With limited resources, government enforcers are already taking a page from the playbooks of environmental activists, who themselves are bringing new pressures for disclosures and changes to companies worldwide. With every trend noted above, companies must not underestimate the power of individual consumers in the age of instantaneous global communication, when even one or two individuals can alter the plans and policies of government and industry.

Before Henry Diamond passed away, he penned an eloquent call to action that appeared in the March/April edition of the Environmental Law Institute’s Environmental Forum (“Lessons Learned for Today”). I commend that article to you. It shares the story of the 1965 White House Conference on Natural Beauty and how a diverse and committed group of businesspeople, policymakers, and conservationists (some of whom were all of those things) at that event influenced the evolution of environmental law and regulation for the decades to come. Laws such as the National Environmental Policy Act, the Clean Air Act, the Clean Water Act, and others have their roots in that Conference. In recognition of his lifetime of leadership, Henry received the ELI Environmental Achievement Award in October 2015. The tribute video shown during the award ceremony underscores Henry’s vision and commitment to advancing environmental law. I hope it may inspire ACOEL members and others to follow Henry’s lead.

These are just a few things I think the future holds for environmental lawyers. What trends do you predict? How should the environmental bar and ACOEL respond?

The ecosystem services framework focuses on the economic values humans derive from functioning ecosystems in the form of services—such as water filtration, pollination, flood control, and groundwater recharge—rather than commodities—such as crops, timber, and mineral resources. Because many of these services exhibit qualities similar to public goods, ecologists and economists began forging the concept of ecosystem services valuation in the 1990s as a way of improving land use and resource development decision making by ensuring that all relevant economic values were being taken into account when making decisions about the conservation or development of “natural capital” resources. Research on ecosystem services exploded onto the scene in ecology, economics, and other disciplines bearing on environmental and natural resources management.

The policy world quickly picked up on the ecosystem services idea as well. In 1998 the President’s Council of Advisors on Science and Technology (PCAST) issued a report emphasizing the importance of the nation’s natural capital. The United Nations embraced the concept at the global scale with its Millennium Ecosystem Assessment, in which it explicitly tied ecosystem services to human prosperity.

By contrast, uptake in law has been slow to come. Almost two decades after the PCAST report, it is fair to say that the ecosystem services concept has made few inroads into achieving “law to apply” status in the form of legislative and regulatory text. In one prominent example, when the U.S. Army Corps of Engineers and the Environmental Protection Agency issued a joint regulation in 2008 overhauling their policies on compensatory mitigation under Section 404 of the Clean Water Act, the agencies adopted a watershed-scale focus and declared that compensatory mitigation decisions would take losses to ecosystem services into account. See 33 C.F.R. 332.3(d)(1). This and the few other federal initiatives to use ecosystem services in decision making, while on the rise, have been ad hoc and uncoordinated. But a more coherent federal ecosystem services policy appears on the horizon.

On October 7, 2015, the Office of Management and Budget (OMB), Council on Environmental Quality (CEQ), and Office of Science and Technology (OST) issued their Memorandum for Executive Departments and Agencies on Incorporating Ecosystem Services into Federal Decision Making (the Memorandum). The Memorandum “directs agencies to develop and institutionalize policies to promote consideration of ecosystem services, where appropriate and practicable, in planning, investments, and regulatory contexts.” The goal of doing so is “to better integrate in Federal decision making due consideration of the full range of benefits and tradeoffs among ecosystem services associated with potential Federal Actions.” The scope of the policy goal is broadly stated to include all federal programmatic and planning activities including “natural-resource management and land-use planning, climate-adaptation planning and risk-reduction efforts, and, where appropriate, environmental reviews under the National Environmental Policy Act (NEPA) and other analyses of Federally-assisted programs, policies, projects, and regulatory proposals.” To facilitate agencies in achieving its policy goals, CEQ will prepare a guidance document outlining best practices for: (1) describing the action; (2) identifying and classifying key ecosystem services in the location of interest; (3) assessing the impact of the action on ecosystem services relative to baseline; (4) assessing the effect of the changes in ecosystem services associated with the action; and (5) integrating ecosystem services analyses into decision making. In the interim, agencies have until March 30, 2016 to submit documentation describing their current incorporation of ecosystem services in decision making and establishing a work plan for moving toward the goals of the policy directive. Id. at 4. Meanwhile, CEQ has assembled a task force of experts from relevant agencies to craft a best practices implementation guidance, which will be subject to interagency review, public comment, and, by November 2016, to external peer review consistent with OMB’s information quality procedures and standards. Once the guidance is released, agencies will adjust their work plans as needed. The Memorandum also acknowledges that “ultimately, successful implementation of the concepts in this directive may require Federal agencies to modify certain practices, policies, or existing regulations to address evolving understanding of the value of ecosystem services.”

ACOEL Fellows should watch the Memorandum’s implementation over the next year closely. In particular, incorporation of best practices for ecosystem services impact assessments under NEPA would project the ecosystem services framework into state, local, and private actions receiving federal agency funding or approval. To be sure, there is plenty of work to be done before one can evaluate the Memorandum’s impact on the mainstreaming of the ecosystem services framework into environmental law. Significantly, the timeline of the Memorandum directives will deliver the best practices implementation guidance in the final months of the Obama Administration, leaving it to the incoming administration to determine where to take it. Nevertheless, simply by declaring the incorporation of ecosystem services into federal agency decision making as an Executive policy and laying out the tasks and timelines for doing so, the issuance of the Memorandum has done more to advance the ecosystem services framework as a legal concept than has any previous initiative.

On December 2, 2014 the United States District Court for the Eastern District of Arkansas enjoined the Small Business Administration (SBA) and the Farm Service Agency (FSA) (together the “Agencies”) from making any payments on their loan guaranties to Farm Credit Services of Western Arkansas (Bank), pending the Agencies’ compliance with the National Environmental Policy Act (NEPA) and the Endangered Species Act (ESA). The Bank had loaned nearly $5 million to C&H Hog Farms, Inc. (C&H) in 2012 for the construction of a confined animal feeding operation (CAFO), collateralized by a guaranty from the United States.

The court’s decision paves the way for potential alteration of the collateral agreement terms, over two years after the non-party Bank had closed and funded the loan. Such court action could jeopardize the farm loan guaranty program.

In its decision the court found that the SBA failed to conduct any environmental review of its loan guaranty or to consider the impact of that loan on the endangered Gray Bat that resides in an area near the CAFO, and that the FSA’s environmental impact and endangered species reviews were inadequate; the Agencies’ actions thereby violated both NEPA and ESA. The court’s injunction precludes the Agencies from making any payment on their loan guaranties to the Bank until they have complied with their obligations under NEPA and ESA, giving them a year to do so.

In August of 2012, and as provided under state regulation, C&H received a General No Discharge Permit (Permit) from the Arkansas Department of Environmental Quality (ADEQ) that addresses the management of manure, litter, and process wastewater generated from the CAFO. The Permit authorizes up to 6503 swine, at a location along a creek that discharges to the Buffalo National River, the nation’s first national river.

Upon completion of FSA’s review process and issuance of a Finding of No Significant Impact in August 2012, C&H obtained an initial construction loan of $3.6 million, 75% of which was guaranteed by SBA. C&H later received a $1.3 million loan, with 90% of that loan guaranteed by FSA. Both loan guaranties were required by the Bank. The loans were funded, construction was completed, CAFO operations commenced, and C&H has been making timely loan payments.

In August of 2013 the Buffalo River Watershed Alliance and several other organizations sued the Agencies, alleging that the CAFO permit contemplated at least occasional discharges of waste into surface waters that could pollute the Buffalo National River, and that the Agencies had violated NEPA, ESA, and certain other federal requirements. The plaintiffs requested that the loan guaranties be enjoined, pending a further environmental review. On December 2, 2014 an injunction was issued. C&H and the Bank were not parties to the litigation.

The significance of this decision is not the finding of a NEPA or ESA violation. What is surprising, and noteworthy, is the Court’s conclusion that such agency action was sufficiently related to a loan arrangement between two entities that were not party to the suit, leading to possible rewriting of that loan two or more years after it was negotiated and closed, and the funds dispersed.

The court concluded there was a sufficient causation nexus because “[w]ithout the guaranties, there would’ve been no loans. Without the loans, no farm.” In addition, the Court concluded that requiring further NEPA and ESA review would in fact redress the plaintiffs’ injuries for the loans already made since the Agencies have an “ongoing role in monitoring any conditions placed on their guaranties,” thereby suggesting that further restrictions could well be placed on C&H’s operation of the CAFO.

The Agencies have now agreed to undertake the additional review within the mandated 12 month time period. That review may result in no additional restrictions, or in restrictions that C&H can carry out without difficulty. With C&H being current on its loan payments, this decision may ultimately have no practical impact on C&H or its Bank. However, the “oh my” scenario is equally possible, because the court’s decision has no limits on the scope of additional restrictions that may be imposed.

As noted by the court, “[t]he federal agencies, through guaranty conditions, have control over C&H’s case-relevant behavior” and “it’s likely that more environmental review will change how C&H operates its farm.” If C&H is unable to meet those restrictions, resulting in a loan default, the Bank will lack the guaranty it required to fund the loan in the first place. Thus, the court has authorized the guarantor to re-write the terms if its guaranty, post hoc, to the severe detriment of the non-party Bank.

With a six year statute of limitations on filing a NEPA claim, what farm loan guaranty is safe from being altered or eliminated as a result of judicial action? Will Old MacDonald be prohibited from obtaining next year’s crop loan until the Agencies complete an EIS, a process that will take a year to complete and likely cause him to miss the planting season?

And what about other endangered species that could implicate the validity of other farm loan guaranties? EPA’s proposed habitat designation for two newly listed endangered mussels will encompass over 40% of the area of the state of Arkansas, impacting one third of all property owners in the state, most of which are farmers.

In addition, the broader implications of this decision on security interests cannot be overlooked. There were no parties in the litigation to argue that relieving the United States from its debt/collateral obligation would unfairly reward the Agencies for their failure to comply with NEPA and ESA. The Agencies certainly did not advance that argument. In fact, the injunction is what the Agencies requested, the court noting that its “Order will follow generally the terms [of the injunction] suggested by [the Agencies].” The Court even ordered the Agencies to “modify or void the loan guaranties as they deem appropriate in light of their revised and supplemented NEPA and ESA analysis.” The impact upon the agricultural loan program is clear, since these loans are routinely traded as federally insured securities.

The Arkansas Farm Bureau has succinctly identified the potential implications of this decision: “[The opinion] probably just made it a whole lot harder for the next guy who’s trying to get a farm loan, regardless of where they are.” You can take that to the bank—or not!

Back in September 2008, TransCanada Keystone Pipeline LP (TransCanada) filed what it probably thought at the time was a straightforward, routine application for a Presidential permit to build its Keystone XL pipeline. As almost everyone knows now, that pipeline would deliver thousands of barrels of Canadian crude oil to refineries on the U.S. gulf coast. The project appeared to be straightforward because the environmental review process required by the National Environmental Policy Act (NEPA) has been honed over many years. If not exactly expeditious, the NEPA process is well known and often used. And the project appeared to be routine because there are many pipelines that already cross U.S. territory.

Yet, six years later, there still is no final decision on a permit. The review process has ballooned into an intricate one, attracting legislative and judicial attention and intervention at both the state and federal levels, not to mention increased public awareness. Normally, one would expect increased public attention and awareness to lead to better decision-making and hopefully that will be the case here. My question, though, is whether this public participation could have been integrated into the NEPA process earlier. A follow-up question might be whether it would have mattered once politics took over.

The delay in completing this project review is undoubtedly frustrating for many and has created a “moving target” conundrum with many other decision-makers now involved. Even with a decision by the Nebraska Supreme Court and a final Presidential decision on the permit, the congressional and federal legal challenges are unlikely to end. Has this project become so politicized that there can be no public confidence in the eventual outcome? Would there have been a better way to encourage public participation earlier?

Nebraska could have gotten involved sooner. The federal NEPA regulations allow a State or local agency “which has jurisdiction by law or special expertise with respect to any environmental impact involved in a [proposed project]” to become a cooperating agency, with the federal lead agency conducting the federal NEPA review. In 2009, the Department of State invited local governments to weigh in on the permitting process for the Keystone XL pipeline under NEPA by becoming a cooperating agency.

At that time, the pipeline route debate had not yet arisen and Nebraska could still participate in the NEPA process by providing comments. In addition, the federal NEPA regulations normally require a cooperating agency to use its own funds. Nebraska’s ability to fund its own NEPA-like review of the project was severely limited since the state had no similar NEPA-like requirement or source of funding at that time. Given the lack of controversy early on, the extra expense of becoming a cooperating agency seemed unnecessary when the opportunity to offer comment was an option.

Would Nebraska involvement at that earlier time have made a difference? It’s hard to say. Opposition to the pipeline route in Nebraska only started to come together when the Final Environmental Impact Statement (EIS) came out in August of 2011 and TransCanada began contacting local landowners to obtain easements. The growing opposition led to Nebraska legislation essentially creating a cooperating role for Nebraska by providing adequate funding for preparation of a report to supplement the federal EIS. That report was published in January 2013.

In addition to Nebraska’s actions, the U.S. Department of State determined that more information was needed about alternative routes to avoid the environmentally sensitive Sand Hills region of Nebraska. This prompted Congress to adopt a provision forcing Presidential action on the 2011 EIS within 60 days.

The President then denied the permit for the reason that it didn’t allow sufficient time to review the proposed alternative route through Nebraska. TransCanada re-applied in May 2012 with a proposed new route through Nebraska. This led to more state legislation, state legal challenges, a supplemental report issued by Nebraska in 2013, and a Final Supplemental EIS issued by the U.S. Department of State. But, there’s still no permit decision, as most parties are awaiting a final decision by the Nebraska Supreme Court on the constitutionality of the state legislation.

This looks more like a schizophrenic chess match than responsible government. Is it just government avoiding a difficult and controversial decision? But, with so many wrenches thrown into this particular NEPA review, how could we expect the process to reach a final resolution in a timely manner? It is rare these days to find any public policy being made in a forthright and timely manner without competing vested interests impeding the administrative process in any number of “legitimate” ways. Unfortunately, environmental issues are no different in this respect than immigration or health care. The Keystone XL pipeline is only one example where our Constitutional construct has given us lots of “checks” without much balance.

November 1967: The Moody Blues release their second album, Days of Future Passed, said to be an influential work of the countercultural, psychedelic era. May 2014: Wolverine goes back in time to rally the X-Men against the Sentinels in Days of Future Past. In between: Ed Muskie and Leon Billings roamed the Earth, particularly the U.S. Senate, and modern-day environmental law was born and thrives.

2014 also is the centennial of the birth of Muskie in the old mill town of Rumford, Maine. On November 15, almost exactly 47 years after release of Future Passed, Harvard Law Professor Richard Lazarus and Leon Billings, Senator Muskie’s former chief of staff, spoke on a panel looking back and to the future of laws like the Clean Air and Water Acts that were unanimously passed by the Senate through the guidance of Muskie and Billings.

Billings spoke of how what Muskie was able to shepherd through Congress and into law involved concepts still pervasive and taken for granted today—such as private attorneys general, nondegradation, open decision-making, the public’s right to breathe healthy air and removal of the right to pollute. He described Muskie’s insistence of and ability to achieve bipartisanship, with allies for the CAA and CWA efforts including such Senators as Baker, Eagleton, Cooper, Bayh, Boggs and Dole, as well as the exhaustive efforts to fully vet and document the need for legislation. For example, for the CWA the Senate Committee held 33 days of hearings with 1721 witnesses, 470 statements and 6,400 pages of testimony, followed by 45 sub-or-full-Committee markup sessions and 39 Conference meetings.

Billings then focused on two concepts that he said demonstrate Muskie’s ability over 40 years ago to look to the future. The first, “waters of the Unites States” grew out of the Senator’s knowledge of the 1899 Refuse Act; he successfully convinced his colleagues that the Act supported a broad view of “waters of the US” to include, for example, wetlands. Since then, the Supreme Court has gone “at least as far as we had expected, and more broadly than we could have hoped”, said Billings.

The second concept is that of climate change and the Clean Air Act. Billings was very clear: Section 111(d) was no accident, is not being misinterpreted, and Muskie intended there to be a legislative basis for then-unknown or undefined pollution problems like CO2, what Billings now calls the “epitome of the precautionary principle”. The phrase “selected air pollution agents” almost never made it out of the House-Senate Conference in December 1970, but a compromise was struck so late at night it never made it into the Conference reports. And while no one then envisioned CO2 and climate change, Billings said that if Muskie were alive when the Supreme Court ruled in Massachusetts v EPA that CO2 is a pollutant, he would have said, “Why do you think I put that provision in there in the first place?”

Richard Lazarus then spoke of Senator Muskie’s enduring legacy in the courts as the font of legislative intent underlying many environmental laws, including frequent references to Muskie in court opinions and during oral arguments at the Supreme Court. He also demonstrated that while President Nixon did sign the bills authored by Muskie and had the label of being an environmental President, in fact he was largely using the issue for a short time as a defensive measure to cut off Muskie’s prospects as a potential 1972 Presidential candidate. Richard then showed slides of handwritten notes made by Nixon’s Chief of Staff, H.R. Haldeman of three discussions with the President: in February 1971, even when they thought environmental protection “has to be done”, at the same time they thought it “is not worth a damn”; in June “should take on environment—it’s not a sacred cow”; and by July 1971 they wanted to put the “brakes on pollution bills…when we can without getting caught”, and to “reexamine all pollution bills in terms of current economic impact”.

Richard also discussed the current EPA rulemaking under 111, especially referencing the term “best system of emission reduction”; EPA’s June 2014 legal memorandum in support of its rulemaking proposal used Senator Muskie’s own words concerning “system” as encompassing the potential for emission reductions to occur outside the fence, and to include more than just controls. He said that for EPA, Muskie is its “Mr. Clean”.

During Q&A, both panelists discussed the partisanship of the past 10-20 years contrasted with during Muskie’s era. Billings mentioned how during Muskie’s opening presentation of the Clean Air Act on the Senate floor, the presiding officer was Senator Barry Goldwater, who sent down a note (now lost to history) saying, “Ed, that is the finest speech I think I have ever heard on the floor of the U.S. Senate.” Turning to NEPA, the concept of an” environmental impact statement” developed through a personal compromise Muskie struck with Senator Jackson.

Afterwards I asked Billings, “If Ed Muskie and you were in the Senate now, what would you be doing?” He said, “If we were the majority party, holding a lot of oversight hearings to bring in all the scientists and evidence; if the minority party, writing speeches.”

And that is how the Past (or Days Passed) in Environmental Law still have major force in today’s many controversies. Oh, by the way: The Moody Blues recently released a new box set, “Timeless Flight”, and are still touring. Long live rock and environmental laws!

Late last year, Amazon CEO Jeff Bezos announced on 60 Minutes plans to launch drones to deliver products purchased by Amazon customers. Fleets of flying arachnoid contraptions will deposit discount books and kitchen gadgets on customers’ doorsteps within minutes of their online orders. Is this an exciting innovation or a really bad idea?

The growing infatuation with what the Federal Aviation Administration (FAA) defines as Unmanned Aircraft Systems (UAS) for commercial, scientific, or recreational purposes presents the FAA with an extremely complex task of integrating these machines into the national system for regulation of airspace. In addition to serious airspace safety and national security concerns, the wider use of drones raises privacy issues as well as environmental concerns such as noise, emissions, injury and disturbance of wildlife, especially birds, impaired visibility, and aesthetic impacts to our landscapes and our skies.

In 2012, Congress passed the FAA Modernization and Reform Act to recognize and regulate commercial drones. The law requires the FAA to prepare and publish a five-year roadmap to guide aviation stakeholders on the tasks involved in integrating UAS into the National Airspace System of regulated aircraft equipment, procedures, operator training, and certification of compliance. The road map issued November 7, 2013, states that proposed civil and commercial uses of UAS include security awareness, disaster response, communications, cargo transport, infrastructure monitoring, commercial photography, aerial mapping and charting, and advertising. The agency has announced plans to propose rules to regulate small drones—those weighing less than 55 pounds and flown under 400 feet in altitude—this year to ease the restriction on machines presenting little or no risk to commercial aviation. But even this category of equipment presents significant regulatory concerns and complexities.

The FAA currently handles approvals for use of UAS by issuing certificates of waiver or authorization to public operators and special experimental certificates to civil applicants. Researchers from private universities have complained about being excluded from the approval process. FAA’s recent assertion of broad authority over “any contrivance invented, used, or designed to navigate in the air” has also come under criticism from this quarter on the ground that tight limits “stunt scientific advancement.”

The FAA knows how to set standards and certification requirements for aviation equipment and operators. Major differences with drones are the absence of an on-board operator to help avert collisions, the potentially much greater variety and quality of equipment, and the much larger number of operators to be regulated and subjected to liability for unsafe operation. Cheerleaders for faster approval of drones are apparently untroubled by the already significant level of accidents involving both military and commercial drone operations. (Craig Whitlock, FAA will miss deadline to integrate drones in U.S. skies, report says, WASHINGTON POST 2 (June 30, 2014.))

Advocates for opening the airspace to wider use of UAS are entitled to tout the benefits to be gained and money to be made from a new industry. However the first priority of government regulators must be to protect a system that has delivered a high degree of safety in the aviation sector. Beyond the challenge of assuring aviation safety is the equally daunting question of homeland security. Our huge investment in airport and airline security have so far succeeded in preventing further successful terrorist attacks on air transportation in the United States. The proliferation of commercial drones potentially armed and operated by thousands more people across the country presents new risks to our safety from criminal or terrorist activity that must be addressed by the FAA and the Department of Homeland Security

Cheap commercial drones carrying high-powered cameras, a favorite new application, can conduct surveillance threatening privacy interests. They will be stealthy surrogates for gum-shoe investigators trailing debtors, straying spouses, or people falsely claiming disabilities. At a time when the public has expressed worry, if not outrage, over governmental and commercial surveillance of their lives, magnifying this risk by the expansion of camera-toting drones will not be welcome. It is small wonder that polling by the Pew Research Center shows that 63% of Americans think it would be a change for the worse if personal and commercial drones are permitted to fly through most U. S. airspace.

The FAA’s five-year plan refers without elaboration to the National Environmental Policy Act. Actions to expand use of drones will require an assessment of environmental impacts, whether or not the FAA itself has the authority to address them. Environmental impacts are likely to be a function of the number of drones in use, where they are used and for what purpose, and how any limitations can be effectively administered and enforced. The risk-benefit calculation for the use of drones in Alaska or other wide open spaces, like farm fields or many border regions, will of course be different from their use in urban and suburban areas of the country.

The FAA, however, may not have the last word on commercial drone use. Restrictions on both launch sites and areas of operation are likely to be derived from land use regulation generally imposed by city and county governments. While the FAA can theoretically regulate noise and pollution from UAS at least by broad type, the FAA is not equipped to adopt the kinds of restrictions needed to protect neighborhoods and resources like wildlife from UAS intrusions adversely affecting local environmental health and amenities. State and local governments, therefore, may become the city-by-city battleground and city and county commissions may have the final say on whether they want Mr. Bezos’s drones to be the product-delivery system of the future or whether the speedy dispatch of non-critical consumer goods is not worth the price to be paid in community safety, privacy, and peace.

The National Environmental Policy Act (NEPA) requires federal agencies to evaluate the environmental effects of their proposed actions. When a proposed action may cause significant environmental impacts, NEPA requires the agency to prepare an environmental impact statement that evaluates alternatives including measures to avoid or mitigate impacts. The agency may not divide a single project into separate bites and find that each in isolation would not have a significant environmental impact. Instead, regulations issued by the Council on Environmental Quality require the agency’s environmental review to encompass connected actions and similar actions.

In Delaware Riverkeeper Network v. FERC, Texas Eastern Pipeline Company sought certificates of public convenience from the Federal Energy Regulatory Commission (FERC) authorizing construction and operation of the Northeast Upgrade Project, one of four projects to improve the Eastern Leg of a natural gas pipeline known as the 300 Line. FERC evaluated the Northeast Upgrade project separately from the others on the ground that each project was designed to provide natural gas to different customers pursuant to different contracts within different time frames. FERC concluded that the potential environmental impacts were not significant and terminated its evaluation by issuing a finding of no significant impact. Environmental organizations petitioned for review of the FERC action on the ground that the four pipeline projects were interrelated and cumulatively would, in their view, clear hundreds of forest acres, fragment habitat and adversely impact wetlands and groundwater in significant ways.

On review, the Court of Appeals for the District of Columbia held that FERC’s segmented environmental review failed to meet NEPA’s requirements. The Court reasoned that all four projects involved the construction of a single, physically interdependent pipeline, were undertaken in a close time frame and were financially interdependent. No customer was a customer of a single pipeline segment and no logical justification existed for the choice of where one project ended and the next began. Accordingly, the Court remanded the case to FERC to review the pipeline project as a whole, including its cumulative impacts.

FERC now faces the daunting task of determining how to implement the Court’s holding in other situations. To be sure, in many cases FERC will be able to readily ascertain whether projects involving a single pipeline are physically, financially and temporally interdependent. But in some areas of the country, transmission pipelines are being installed contemporaneously with natural gas wells, gathering lines physically connecting these wells to the transmission pipelines, and supporting roads, impoundments and other infrastructure. Whether these arguably related projects are sufficiently connected or similar to trigger joint NEPA review may turn on whether they involve different ownership, distinct functions, separate financing and customers and clear physical divisions. Resolving these questions may be no easy task, and even then does not necessarily determine whether a full environmental impact statement must be prepared. When performing an environmental assessment of multiple projects together, FERC may still conclude that the environmental effects are insignificant. With so many steps in the analysis that may be controversial, a new wave of NEPA challenges is likely on the horizon.

One postscript for practitioners before the D.C. Circuit. In a punchy concurring opinion, Judge Silberman expressed his dismay at the submission of a brief “laden with obscure acronyms.” For those of us in the environmental bar for whom use of acronyms has become second nature, beware.

Before environmental law existed, David Sive knew that the law could protect forests and fields, abate pollution of air and water, and restore the quality that humans expected from their ambient environments. He fashioned legal arguments and remedies where others saw none. His commitment to building a field of environmental law is exemplary, not just historically, but because we shall all need to emulate his approach as we cope with the legal challenges accompanying the disruptions accompanying climate change.

David Sive learned to love nature by hiking and rambling from parks in New York City to the wilderness of the Catskill and Adirondack Mountains. He carried Thoreau’s Walden into battle in World War II in Europe, and read William Wordsworth and the Lake poets while recuperating from wounds in hospitals in England. He had a mature concept of the ethics of nature long before he began to practice environmental law.

His early cases were defensive. He defended Central Park in Manhattan from the incursion of a restaurant. He rallied the Sierra Club to support a motley citizens’ movement that sought to protect Storm King Mountain from becoming a massive site for generating hydro-electricity on the Hudson River. Scenic Hudson Preservation Conference v. Federal Power Commission [FPC] (2d Cir. 1965), would become the bell-weather decision that inaugurated contemporary environmental law. The case was based on the multiple use concepts of the Progressive Era’s Federal Power Act. The FPC (now FERC), had ignored all multiple uses but the one Con Edison advanced. When the Court of Appeals for the Second Circuit held that citizens had the right to judicial review to require the FPC to study alternative ways to obtain electricity, as well as competing uses for the site, the court laid the basis for what would become Section 102(2)(c) of the National Environmental Policy Act (NEPA).

When Consolidated Edison Company decided to build a huge hydroelectric power plant on Storm King, the northern portal to the great fiord of the Hudson River Highlands, citizens and local governments were appalled. This was no “NIMBY” response. Con Ed had forgotten that these fabled Highlands inspired the Hudson River School of landscape painting. This artistic rendering of nature in turn inspired the birth of America’s conservation movement of the late 19th century. The Hudson also instrumental to the historic birth of this nation; here the patriots’ control of the Highlands had kept the British from uniting their forces, and here soldiers from across the colonies assembled above Storm King for their final encampment as George Washington demobilized his victorious Army. The Army’s West Point Military Academy overlooks the River and Storm King.

David Sive and Alfred Forsythe formed the Atlantic Chapter in the early 1960s, despite heated opposition from Californians who worried the Club would be stretched too thin by allowing a chapter on the eastern seaboard. David Sive chaired the Chapter, whose Conservation Committee debated issues from Maine to Florida. He represented the Sierra Club, pro bono, in its intervention in the Storm King case, and other citizens brought their worries about misguided government projects or decisions to him.

David Sive represented similar grassroots community interests in Citizens Committee for the Hudson Valley v. Volpe (SDNY 1969), affirmed (2d Cir. 1970). Transportation Secretary Volpe had approved siting a super-highway in the Hudson River adjacent to the shore in Tarrytown and Sleepy Hollow, to accommodate Governor Nelson Rockefeller’s proposal to connect his Hudson estate to the nearby Tappan Zee Bridge. Without the benefit of NEPA or any other environmental statutes, which would be enacted beginning in the 1970s, and relying upon a slender but critical provision of a late 19th century navigation law, after a full trial in the US District Court for the Southern District of New York, David Sive prevailed against the State and federal defendants. He won major victories on procedure, granting standing to sue, and on substance, a ruling that the government acted ultra vires. David Sive saved the beaches, parks and marinas of the Hudson shore.

Public interest litigation to safeguard the environment was born in these cases. Public outrage about pollution and degradation of nature was widespread. In September 1969, the Conservation Foundation convened a conference on “Law and the Environment,” at Airlie House near Warrenton, Virginia. David Sive was prominent among participants. His essential argument was that “environmental law” needed to exist.

On December 1, 1970, Congress enacted the NEPA, creating the world’s first Environmental Impact Assessment procedures and establishing the President’s Council on Environmental Quality (CEQ). The CEQ named a Legal Advisory Committee to recommend how agencies should implement NEPA chaired by US Attorney Whitney North Seymour, Jr. (SDNY). This Committee persuaded CEQ to issue its NEPA “guidelines” on the recommendation of this Committee. That year launched the “golden age” of NEPA litigation. Courts everywhere began to hear citizen suits to protect the environment.

David Sive went on to represent citizens in several NEPA cases, winning rulings of first impression. In 1984, he reorganized his law firm, Sive Paget & Riesel, to specialize in the practice of environmental law. From the 1970s forward, NEPA allowed proactive suits, no longer the primarily defensive ones of the 1960s. “Citizen suits” were authorized in the Clean Air Act, Clean Water Act and other statutes.

David Sive knew that without widespread support among the bar and public, these pioneering legal measures might not suffice. He became a founder of the Natural Resources Defense Council (NRDC), which became one of the nation’s pre-eminent champions of public environmental rights before the courts. To continue the Airlie House conference precedent, he institutionalized the established professional study of environmental law, as a discipline, through creation of the Environmental Law Institute (ELI). With ALI-ABA (now ALI-CLE) he launched nationwide continuing legal education courses to education thousands of lawyers in environmental law, a field that did not exist when they attended law school. He devoted an active decade to teaching law students in environmental law, as a professor at Pace Law School in New York.

This month, the Intergovernmental Panel on Climate Change (IPCC) released the second part of its Fifth Assessment Report. The IPCC summaries of peer-reviewed scientific investigation suggest that law will confront problems even more challenging than those that David Sive addressed. New legal theories and remedial initiatives will be needed that do not exist today. The wisdom of ecologist Aldo Leopold can inform the next generation. Globally, others carry on David Sive’s role, such Attorney Tony Oposa in the Philippines or M. C. Mehta in India. The law can cope with rising sea levels, adaptation to new rainfall patterns, and other indices of climate change, but it will take individual commitment to think deeply about environmental justice in order to muster the courage to think and act tomorrow as David Sive did yesterday.

On February 11, 2013, the United States District Court for the District of New Mexico denied a Motion for Preliminary Injunction filed by the Village of Logan, seeking to compel the Bureau of Reclamation (“BOR”) to perform an environmental impact statement (“EIS”) for the Ute Lake Diversion Project in eastern New Mexico. The BOR issued an environmental assessment (“EA”), which failed to analyze the foreseeable impacts to Ute Lake based on the design capacity of the intake structure to withdraw 24,000 acre-feet per year (“af/yr”). The BOR contended that, while contracts had been issued to deliver the full 24,000 af/yr of water, the project which it funded was limited to withdrawals from the lake of only 16,450 af/yr. Significantly, the environmental and socioeconomic impacts of 16,450 af/yr paled in comparison to the projected impacts resulting from withdrawals of 24,000 af/yr.

The briefs in the Tenth Circuit present an issue of first impression under NEPA. That is, can the BOR defer an analysis of certain impacts it knows will occur in the future, and summarily discuss those deleterious impacts under the rubric of “cumulative” rather than “direct” effects? According to the Department of Justice, Logan’s complaint about the matter is only one of “nomenclature,” and it should not matter whether the effects are deemed “direct” or “cumulative.” In response, Logan argues that the difference is one of substance, as an analysis of “cumulative” effects of a project does not require a comparison of the project to reasonably available alternatives, whereas an analysis of foreseeable “direct” effects, i.e., withdrawals up to the capacity of the intake structure, would require a vigorous comparison to available alternatives. These alternatives, which received only a one-half page discussion in the EA’s section on cumulative effects, include retirement of wasteful irrigation groundwater rights to augment municipal water supplies in eastern New Mexico. According to Logan, allowing the BOR to analyze a plainly foreseeable “direct” effect as merely “cumulative” would result in the illegal segmentation of the project. If such a result were sanctioned, there would be no NEPA analysis ever undertaken of the effects between 16,450 af/yr and 24,000 af/yr.

A federal court in Washington, D.C. gave some encouragement to transmission line developers—not to mention sponsors of other linear projects, like gas or water pipelines. In National Parks Conservation Assn. (NPCA) v. Jewell, the court rejected a challenge to the National Parks Service’s grant of special use permits and extended rights-of-way for the Susquehanna to Roseland Transmission Line (S-R Line), a replacement and upgrade project.

The focus of Appellant NPCA’s attack was the National Environmental Policy Act (NEPA), a potent weapon in years past. Under NEPA, a federal agency considering a “major” action must evaluate the environmental effects of the project. After an initial Environmental Assessment, the agency either conducts a full blown Environmental Impact Statement (EIS) or issues a Finding of No Significant Impact. NEPA’s purpose is to ensure that the agency takes a “hard look” at the environmental tradeoffs of its intended action, but once having done that, it can decide to move forward regardless. In other words, NEPA is a procedural statute, but lacks teeth to prevent the agency from acting.

Still, NEPA has proved effective in stopping projects in their tracks. The usual avenues of attack have been whether the agency should have written an EIS, whether it considered all reasonable alternatives, whether the EIS needs updating, and whether the project should be seen in a larger context of other similar developments or as part of a broad program. In recent years, however, the agencies have learned how to beat back such challenges.

The NPCA made allegations on similar bases here, but this time to no avail. The Parks Service’s EIS took an adaptive management approach to mitigation, anticipating that the mitigation plan would evolve. The NPCA argued that the EIS must analyze the mitigation ultimately decided on, but the court was satisfied the agency had taken the requisite “hard look.” Nor did the court find a supplemental EIS necessary because the “new information” adduced by the NPCA concerned environmental effects that were already within the scope of the EIS.

The NPCA also argued that the alternatives analysis in the EIS was lacking because it didn’t adequately consider the no-action alternative. In this case, the no-action alternative would be to pursue a non-transmission approach, such as distributed energy. The court deferred to the Parks Service’s analysis that this alternative would not meet the objective of improving the reliability of the applicants’ existing line. The court found that the Parks Service rationally considered and rejected the no-action alternative.

The court also rejected the argument that the Parks Service should have analyzed the environmental effects of the entire S-R Line, and agreed the agency could look just at the consequences of extending the right-of-way. The judge took note of the fact that the project sponsors could have reconstructed the line on their existing right-of-way, and therefore there was no functional difference between the reconstructed line on the proposed right-of-way and the existing one.

The court’s approach in this case is consistent with NEPA case law in recent years. Agencies will be given some deference in their decision making, so long as their NEPA documents indicate a good faith effort to look at environmental impacts. Project opponents can no longer rely on NEPA as a reliable weapon to block development.

On Friday, May 17, the Department of Energy (DOE) announced it had conditionally authorized Freeport LNG Expansion, L.P. and FLNG Liquefaction, LLC (collectively Freeport) to export domestically produced liquefied natural gas (LNG) to countries that do not have a Free Trade Agreement (FTA) with the United States from the Freeport LNG Terminal on Quintana Island, Texas. This marks only the second time that the DOE has granted a natural gas export license to non-FTA countries, and only the first after DOE ceased action on all applications pending a study of the economic impacts of LNG exports. The Freeport approval marks a noticeable, but likely incremental shift in US policy towards increased export of natural gas to non-FTA nations, opening up new markets for the boom in domestic natural gas production.

The DOE rejected opponents’ arguments that the project would be inconsistent with the public interest. Among other reasons, the DOE found that the proposed exports are likely to yield net economic benefits to the US, would enhance energy security for the US and its allies, and were unlikely to affect adversely domestic gas availability, prices or volatility. Accordingly, DOE conditionally granted Freeport’s Application, subject to satisfactory completion of an environmental review pursuant to the National Environmental Policy Act (NEPA) by the Federal Energy Regulatory Commission (FERC) and DOE. FERC will serve as the lead NEPA review agency. DOE will subsequently reconsider the conditional order in light of the NEPA analysis led by FERC and include the results in any final opinion and order.

Environmental issues will now take center stage as interested stakeholders seek to influence the government’s conclusions in the NEPA review. In support of its application, Freeport extolled the following environmental benefits of the project:

• Natural gas, the cleanest burning fossil fuel, would replace coal-fired power resulting in substantial reductions in greenhouse gas and traditional air pollutants. • Compared to the average coal-fired plant, natural gas fired plants emit half as much carbon dioxide (CO2), less than a third of the nitrogen oxides, and one percent of the sulfur oxides. • Natural gas, if used as a transportation fuel, also produces approximately 25 to 30 percent less CO2 than gasoline or diesel when used in vehicles, and is not a significant contributor to acid rain or smog formation.

Opponents of the project, however, are less convinced of its environmental benefits. These include the Sierra Club, the Delaware Riverkeeper Network (consisting of 80 organizations), NRDC, among others. Specifically, they assert that LNG exports will increase demand for natural gas, thereby increasing negative environmental and economic consequences associated with fracking, the process used for shale gas production. They argue that the DOE’s two-part study of the economic impacts of LNG exports, upon which DOE relied in conditionally granting Freeport’s application, failed to consider the cost of the environmental externalities that would follow such exports, which include:

• Environmental costs associated with producing more shale gas to support LNG exports;• Opportunity costs associated with the construction of natural gas production, transport, and export facilities, as opposed to investing in renewable or sustainable energy infrastructure;• Costs and implications associated with eminent domain necessary to build new pipelines to transport natural gas; and• Potential for switching from natural gas-fired electric generation to coal-fired generation, if higher domestic prices cause domestic electric generation to favor coal-fired generation at the margins.

Sierra Club and other organizations have previously challenged the adequacy of FERC’s and DOE’s NEPA determinations in other LNG export applications. In the first LNG export license approval for Sabine Pass Liquefaction, LLC (DOE Docket. No. 10-111-LNG), Sierra Club, as an intervener in the FERC proceeding, challenged the adequacy of FERC’s NEPA compliance, and the lawfulness of the FERC’s determination to authorize the Project facilities. The FERC addressed these concerns and found that if a series of 55 enumerated conditions were met, the Project would not constitute a major Federal action significantly affecting the quality of the human environment.

After FERC authorized the Liquefaction project, Sierra Club filed a motion to intervene out of time before DOE , again challenging FERC’s NEPA determinations. DOE rejected Sierra Club’s motion, and granted the final order approving the LNG export on August 7, 2012. Sierra Club subsequently sought a rehearing on the final order which was also rejected by the DOE in a January 25, 2013 order.

Similarly, earlier this month, Sierra Club and other environmental organizations objected to the proposed Dominion Cove Point LNG export terminal in Maryland, arguing the project would harm the Chesapeake Bay’s economy and ecology, increase air pollution, and hasten fracking and drilling in neighboring states. On May 3, 2013, the coalition filed public comments and a timely motion to intervene in the proceedings calling on FERC to conduct a thorough environmental review, or prepare an EIS, of the project. The proposed terminal will be the only LNG export facility in the east coast, providing foreign markets with access to natural gas from the Marcellus Shale.

In a decision that should not have come as a surprise to anyone, the 9th Circuit Court of Appeals ruled late last month, in Conservation Northwest v. Sherman, that the Bureau of Land Management and other agencies implementing the Northwest Forest Plan could not amend the NFP without complying with the procedural requirements of the Federal Land Policy Management Act. The rationale of the decision should apply far more broadly than just the FLPMA, however. It should apply to any action by any agency purporting to amend agency regulations that would otherwise be subject to procedural requirements, such as notice-and-comment rulemaking, without complying with those procedural protections.

The history of the case itself it tortuous and not really relevant here. The short version is that the agency defendants sought to resolve citizen litigation regarding the “Survey and Manage” provisions of the NFP by entering into a consent decree that would amend certain elements of Survey and Manage. It was uncontested that, if the agencies had sought to do so outside the context of litigation, they would have had to follow FLPMA requirements. The agencies – and the District Court which upheld entry of the consent decree – argued that, because approval of a consent decree is a “judicial act”, it is not subject to the FLPMA procedures.

I’ve got to say, that argument just seems like a non sequitur to me. In any case, the 9th Circuit rejected it, concluding that:

"a district court abuses its discretion when it enters a consent decree that permanently and substantially amends an agency rule that would have otherwise been subject to statutory rulemaking procedures."

On February 11, 2013, the United States District Court for the District of New Mexico denied a Motion for Preliminary Injunction filed by the Village of Logan, seeking to compel the Bureau of Reclamation (“BOR”) to perform an environmental impact statement (“EIS”) for the Ute Lake Diversion Project in eastern New Mexico. The BOR issued an environmental assessment (“EA”), which analyzed the impacts from the diversion project based on the withdrawal of only 16,450 acre-feet per year (“af/yr”), despite the fact that the intake structure capacity is 24,000 af/yr. The BOR contended that the intake structure did not have sufficient pumping capacity and other infrastructure to achieve 24,000 af/yr.

At the preliminary injunction hearing, Logan presented evidence that the Interstate Stream Commission of New Mexico (“ISC”), as the putative owner of the water rights within Ute Lake, had contracted to sell 24,000 af/yr and that the engineering analysis demonstrated sufficient existing capacity within the intake structure to accommodate withdrawals of 24,000 af/yr. Consequently, similar to analyses required under other environmental laws, including the Clean Air Act, Logan argued that the impacts from the proposed project must be analyzed based on the maximum achievable withdrawal capacity of the intake structure.

The difference in the severity of impacts, based on 24,000 acre-feet withdrawals and 16,450 acre-feet withdrawals, was significant. The EA conceded that, at 24,000 acre-feet per year, the minimum fisheries pool in Ute Lake – established to provide a minimum necessary habitat for recreational fishing – would be breached at least 20% of the time over a 30-year period. Allowing the fisheries pool to be breached for at least 6 years over the life of the project created inter-related economic impacts, including significantly decreased property values on the shoreline, decreased tax receipts for the community, lost jobs, and significantly declining revenue for the New Mexico Department of Game and Fish.

The district court ruled that the EA, together with its finding of no significant impact (“FONSI”), was not arbitrary and capricious based on the assumption that the withdrawals would only reach 16,450 af/yr. The Court stated that, “If in the future, more infrastructure is added to facilitate further withdrawals, primary analysis of the environmental impact may be undertaken then.” The Court did not state whether such a “primary analysis” would occur within or outside of NEPA, and who would be responsible for initiating such an analysis. Moreover, assuming that the Court meant an analysis of “direct impacts” by the phrase “primary analysis,” it is unclear how such an analysis would not suffer from predetermination under NEPA. After all, the intake structure would already be built and there could not be any serious consideration of viable alternatives to the project.

The central issue on appeal is whether a federal agency may postpone part of its NEPA analysis to some unspecified time in the future, despite the fact that the capacity of the project, and the ability to withdraw 24,000 af/yr, is likely a “foreseeable” impact as defined in the Council on Environmental Quality regulations.

In recent years, several courts have addressed the issue of what standard a plaintiff must meet to successfully challenge agency action on the ground that it was improperly predetermined in violation of the National Environmental Policy Act (NEPA). Because federal agencies conducting major federal action subject to the requirements of NEPA frequently have a preferred alternative in mind when conducting environmental review, legal challenges based on claims that the agency improperly predetermined the outcome of its NEPA analysis are common. When an agency action is successfully challenged for improper failure to prepare an Environmental Impact Statement (EIS) and the agency reaches the same result upon completion of an EIS, plaintiffs may raise a claim of improper predetermination, contending that the result is essentially a foregone conclusion.

Circuit courts have generally imposed a stringent burden on plaintiffs seeking to prove predetermination in violation of NEPA. Most recently, the Tenth Circuit addressed the appropriate standard for predetermination in Wyoming v. United States Department of Agriculture. In Wyoming, the State of Wyoming challenged a final rule promulgated by the United States Forest Service that prohibited road construction and commercial timber harvesting in inventoried roadless areas of the National Forest System. The State alleged, among other claims, that the Forest Service impermissibly predetermined the outcome of the Roadless Rule proceeding. The Tenth Circuit Court of Appeals reversed the district court, relying on the stringent standard it had set forth in Forest Guardians v. United States Fish & Wildlife. The court noted that “predetermination occurs only when an agency irreversibly and irretrievably commits itself to a plan of action that is dependent upon the NEPA environmental analysis producing a certain outcome, before the agency has completed the environmental analysis….”

The Ninth Circuit adopted a similarly stringent standard. Metcalf v. Daley. In Metcalf, the court found improper predetermination where the agency signed two written agreements binding them to support the proposal under consideration before preparing an Environmental Assessment and Finding of No Significant Impact. The Ninth Circuit held that the agencies had violated NEPA by making an “irreversible and irretrievable commitment of resources” prior to completing the environmental review.

In Forest Guardians, the Tenth Circuit also addressed the question of what evidence should be considered by a court in evaluating whether an agency has improperly predetermined its outcome in violation of NEPA. The court concluded that review of evidence outside the environmental review itself is proper where there is a claim of predetermination. In reaching this conclusion, the Court expressly rejected the dicta of the Fourth Circuit in National Audubon Society v. Department of the Navy, stating that a reviewing court “should generally restrict its inquiry to the objective adequacy of the EIS . . . [and] should not conduct far flung investigations into the subjective intent of the agency.” The Fourth Circuit reasoned that “[w]here an agency has merely engaged in post hoc rationalizations, there will be evidence of this in its failure to comprehensively investigate the environmental impact of its actions and acknowledge their consequences.” Because such evidence was absent, the Fourth Circuit affirmed the district court’s conclusion that the Navy had failed to undertake the hard look at environmental consequences that NEPA requires.

In light of these decisions, plaintiffs alleging that an agency has improperly predetermined the outcome of its environmental review in violation of NEPA face an uphill battle in establishing liability. The imposition of such a stringent burden is well supported by the language of the Council for Environmental Quality regulations implementing NEPA, see 40 C.F.R. § 1502.14(e), as well as by Supreme Court precedent holding that there must be a strong showing of bad faith or improper behavior before inquiry into the mental processes of administrative decision makers may be made. Citizens to Preserve Overton Park, Inc. v. Volpe.

Recently, the Bureau of Land Management ("BLM") and several Montana environmental groups agreed to suspend 61 Montana oil and gas leases as settlement of a case challenging lease issuance for failure to consider climate change effects. The leases, which had been issued, were suspended while BLM conducts additional analysis of greenhouse gas fugitive emissions and climate change impacts under the National Environmental Policy Act. As part of the settlement, BLM also asserts "authority to void or terminate any lease, if it determines upon review that such an action is appropriate.

On March 18, 2010, Judge Molloy of the United States District Court for the District of Montana entered an order dismissing the case based on the settlement agreement, despite the absence of the oil and gas industry from the settlement discussions. BLM and the environmentalist parties are seeking to keep confidential the deliberations that led to the settlement. This stands in contrast to prior positions taken by the United States regarding the release of settlement discussion documents under the Freedom of Information Act (FOIA) pursuant to the U.S. Supreme Court Klamath decision in 2000.

Unlike the 77 Utah leases that were voided by BLM in 2009, the agency did not admit to error in the NEPA process leading to issuance of the leases. The takeaway from these BLM actions is to make sure that your company has solid NEPA analysis that fully considers climate change and greenhouse gas issues, including those resulting from production and gathering operation fugitive emissions, when applying for leases and APDs. The willingness to suspend or void leases represents a new chapter in available remedies BLM is willing to use, whereby even already issued leases may now be at risk. Click here to review the settlement and click here to review the order.

American College of Environmental Lawyers, The ACOEL, is a professionalassociation of lawyers distinguished by experience and high standards in the practice of environmental law, ethics, and the development of environmental law.